Year-on-year inflation decreased to 1.2%

Consumer price index in Azerbaijan was 1.2%. At the same time inflation, according to official estimates, there was mainly due to higher prices for paid services 3.4%.

According to the State Statistics Committee, in January-March, annual inflation for food products accounted for only 0.2%, while non-food prices rose 0.4%.

Income growth has outpaced the rate of inflation of 3.3%. Per capita income averaged 836.4 manat, of which 70% were referred for final consumption, and 17.9% increase in capital and deposits. The remaining 9.4% was spent on payment of taxes and other obligatory payments.

Almost 1.2% figure is the logical continuation of the inflation rate in 2012, when the total was summed up by the State Statistics Committee index 1.1%. This figure is markedly at odds with the alternative measure of the counting of the Center for Economic Research (CER), which calculates the consumer price index on the basis of objective measure, derived on the basis of the international system of calculating the relative risk (VAR). CER inflation data released last year at 9.9%.

This year, government figures have nothing to counter the lack of funds for the alternative calculation of inflation. Director of CER Gubad Ibadoglu told Turan news agency that there was no donor funding for such a study.

However, benchmarking of the past and some social upheavals of the last year give reason to question the State Statistics Committee.

But first of all it is necessary to take into account the political and economic incentive for governments in the interest of low inflation. It succinctly formulated at a cabinet meeting on April 14, President Ilham Aliyev, who literally said that while increasing salaries and pensions is planned, but it may adversely affect the macroeconomic performance of the country.

It should be noted that the government is interested in the low level of inflation, as it is based on the indexed base part of labor pensions. Due to the one per cent inflation this year indexation had been made, but it is, in practice, may be made on the eve of the presidential elections in September as a tasty morsel for the voter.

It is noteworthy that the inflation data of the first quarter of 2012, which was higher, were made public only after the then government's April meeting with the President. For the quarter, inflation was 3.1 percent, including food increased in price by 3.9%, non-food products - 1.3%, services - 2.5%. According to NGO estimates, "Center for Economic Research" annual inflation was significantly more than the official figures - 7.25%.

At the end of the first four months already in 2012 inexplicably inflation fell to 2.7%, while for the same period in 2011, inflation has reached 9%. As a result of strong demand on inflation has been brought to the famous 1.1%.

Questioned the official inflation data put social protests in Guba, Ismaily, factory workers, entrepreneurs, farmers, and the recognition of the President that there were unacceptable levels of social inequality.

He also does not allow high inflation, as this may confuse many of the plans of the government. After all, the higher the inflation, the higher the cost of the loan. And this is problematic for the development of non-oil sector of the economy. Therefore, it is expected that the predicted for 2013 inflation 5.7% and will be reduced by administrative order. -0 -


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